In this episode, we unpack the complex world of consumer debt—the money individuals owe for goods that are consumed rather than invested. We explore why buying a big-screen TV on credit is considered "fiscally suboptimal" compared to secured loans like mortgages, and how the "Permanent Income Hypothesis" suggests borrowing can actually help smooth consumption over a lifetime.

Tune in as we break down:

• The Definition: How consumer debt differs from business or government debt, focusing on credit cards, payday loans, and student loans.

• The Risks: The link between high-interest debt, predatory lending, and negative impacts on mental health and credit scores.

• The Metrics: Understanding the "consumer leverage ratio" and why experts advise keeping debt payments under 20% o ...